Govt makes selfies compulsory for investing in cryptocurrencies like Bitcoin:Now, investors will also have to share their live location for opening crypto accounts

According to news agency, PTI, India has made rules stricter for cryptocurrency exchanges to prevent money laundering and terrorist financing. These rules are designed to make it harder for criminals to use crypto for illegal activities. Key Changes for Crypto Users Selfie with Liveness Detection: New users must take a selfie that proves they are a real person. The system will check if the person is actually present and alive. The same software can be used as in the case of the generation of life certificates for pensioners. Location Tracking: Exchanges will record the geographical coordinates (latitude and longitude) of where the user is when they sign up. They will have to share live location with the exchage where their account will be opened. Bank Account Verification: Exchanges will use the “penny-drop” method to verify bank accounts. This involves sending a small, refundable amount (₹1) to the user’s account to confirm ownership. PAN Card Mandatory: Users must provide their Permanent Account Number (PAN), which is a unique identification number for tax purposes in India. Discouraging Risky Practices No ICOs/ITOs: The rules discourage crypto exchanges from offering Initial Coin Offerings (ICOs) or Initial Token Offerings (ITOs). These are similar to IPOs in the stock market but are considered riskier. No Anonymity Tools: Exchanges are not allowed to facilitate transactions involving “tumblers,” “mixers,” or anonymity-enhancing tokens. These tools make it harder to trace crypto transactions. Why These Rules? The Financial Intelligence Unit (FIU), which is part of the Finance Ministry, is implementing these rules. The goal is to make sure crypto exchanges follow anti-money laundering (AML) and combating financing of terror (CFT) guidelines. What Crypto Exchanges Must Do? Register with FIU: All crypto exchanges in India must register with the FIU.
Report Suspicious Activity: Exchanges must report any suspicious transactions to the FIU.
Keep Records: Exchanges must keep detailed records of their clients to help identify and prevent illegal activities.
Update KYC Regularly: Exchanges must update their “Know Your Customer” (KYC) information for high-risk clients every six months and for all other clients annually. Enhanced Due Diligence For high-risk individuals or entities, exchanges must do extra checks, including gathering information from public sources and databases. This includes people with links to tax haven countries, politically exposed persons, etc. No Hiding Transactions Crypto “tumblers” or “mixers” that blend coins from different sources to hide their origin are not allowed. Exchanges must take steps to prevent these types of transactions. Exchanges must keep historical record of users Exchanges must keep client ID, address, and transaction details for at least five years, even the time the investigation is going on. Conclusion These new rules mean that it will be harder to use cryptocurrency for illegal activities in India. Crypto exchanges must now collect more information about their users and monitor transactions more closely.